Presenter Info - Andreas Antonopoulos

Education MBA, 2001, Weatherhead School of Management, Case Western Reserve, USA Ph.D., 1997, Electrical & Electronic Engineering, University College London, UK. M.Eng , 1994, Electrical & Electronic Engineering, University of Patras, Greece. Currently University of New York in Prague, Rector and Professor of Telecoms Business and Prague Entrepreneurship Working Knowledge, Co-Founder and Managing Partner Marathon Invest, Co-Founder and sitting on the Board of Directors Viva Credit, Angel Investor & Board of Directors University College London, Adjunct Professor Background - Combination of Industry, Entrepreneurial, Academic background - Have started 4 ventures, 1.5 successful exits... - Employed in Industry at RHK (now Ovum), Bell Labs/Lucent Technologies, Nortel Networks and British Telecom - Employed in Academia at UNYP, CEU Business School, University College London - Consultancy work with 30+ companies (via Working Knowledge) Argentina, Brazil, Germany, Greece, Hungary, Philippines, - Worked and/or lived in Argentina Brazil Germany Greece Hungary the Philippines Romania, Singapore, Spain, Thailand, UK and the US - Have taught/guest lectured at 8 Universities

Principles of Intrapreneurship

Who wants to be an Entrepreneur?

Anyone who wants to experience the Anyone deep, dark canyons of uncertainty and ambiguity; and who wants to walk the breathtaking highlands of success. But I caution, d not plan t walk the l tt ti do t l to lk th latter, until you have experienced the former. An Entrepreneur

What is Entrepreneurship? Who is an Entrepreneur?

Creating and building something of value from practically nothing. The pursuit of opportunity without regard to resources controlled. A way of thinking and acting that is opportunity obsessed holistic in A obsessed, approach, and leadership balancedfor the purpose of wealth creation. Any self Any attempt at new business or new venture creation, such as selfemployment, a new business organization, or the expansion of an existing business, by an individual, a team, or an established business. The Act of being an entrepreneur (Wikipedia) An entrepreneur is a person who has possession of a new enterprise, venture or idea, and assumes significant accountability for the inherent risks and the outcome.

A way of managing and leading.

What Skills are Important? p

Creativity and opportunity recognition/evaluation y pp y g Real-time strategy and decision making Comfort ith h C f t with chaos, ambiguity and risk bi it d i k Understanding of start-up basics and accounting Teamwork Evangelism, selling, negotiating, Evangelism selling negotiating and motivation through influence and persuasion Communications skills both oral and written

Traditional vs. Entrepreneurial Career Paths

High School
High School

University
University

Practical Experience Management Training Well Managed, Hi h G W ll M d High Growth Fi th Firm

Big Company (or Companies)

Startup Venture Another Startup?

Retire

Venture Capital or Angel Investor Never really retire

Intrapreneurship
Intrapreneurship is the act of behaving like an entrepreneur except within a larger organization. p g g "A person within a large corporation who takes direct responsibility for turning an idea into a profitable finished product through assertive risk-taking and i th h ti i k t ki d innovation". ti " First introduced in 1976 by the Economist! An entrepreneur takes substantial risk in being the owner and operator of a business with expectations of financial profit and other rewards that the business may generate. On the contrary, an intrapreneur is an individual employed by an organization for remuneration, which is based on the financial success of the unit he is responsible for. Intrapreneurs share the same traits as entrepreneurs such as conviction, zeal and insight Do you have this drive? Can you identify intrapreneurs into your organizations?

Intrapreneurial Managers p g
What are the differences in skill sets and characteristics th t i t h t i ti that intrapreneurial managers i l need to learn vs. traditional managers?
Pro-activeness Creativity Strong drive for results Good corporate understanding co po ate u de sta d g Good market understanding Opportunity identification skills Analytical and business casing skills Sales skills

What Do you Think of Argentinians as Entre/Intrapreneurs?

Individualistic? Feedback seeking? Competitive? p Team players? Creative? Risk taking?

Can Entrepreneurship be Taught?

Yes Skills and knowledge transfer Doing vs. Teaching g g Pele and Ronaldo each had a coach. Mental Framework to Carry Into Entrepreneurial Situations: You CAN do it, too You it too. Confidence not arrogance Mistakes to be Avoided: e.g. Viability of opportunity, assessment of viability and finances No Personality and risk tolerance (leadership?) Personality, Some things are just the way they are. Its like going to war. You never know if y or anyone else is g g you y capable until the shit hits the fanthen you know.

Windows of Apprenticeship
Why is it important? For how long? What was different about the dot.com period? What lessons dot com can be drawn from the period? If you want the odds in y y your favor, get the experience first.. ,g p On average, success stories had 7-10 years work experience and some savings before starting. Most will go through false starts.

The Six dominant Themes Which CANNOT Be Acquired

Commitment & Determination Leadership Opportunity Obsession Tolerance of Risk, Ambiguity, and Uncertainty U t i t Creativity, Self-reliance, and Ability to Adapt y, , y p Motivation to Excel

Non Acquirable Attitudes & Behaviors q

- Energy, health, emotional stability gy, , y - Creativity and innovativeness y - Intelligence g - Capacity to inspire p y p - Values

Myths & Realities y

Entrepreneurs are born not made Entrepreneurs like risk Entrepreneurs are their own bosses and are completely independent p Entrepreneurs work longer and harder than managers in big companies Start a business and fail and you ll never make it again Money is the most important start up ingredient Entrepreneurs should be young and energetic Entrepreneurs are money oriented Entrepreneurs are lone wolves and cannot work with others If an entrepreneur is talented success will happen in a year or two

Major Inventions/Products/Markets j

Many of the above start-ups were bought by incumbents

The Revolution
What factors have driven the Silent Revolution
In the US? In Europe? In other parts of the World?

Entrepreneurship is now taught in more than 2,000 HEIs in the US

Best tool for social mobility

Opportunity pp y Recognition & g Screening g

Starting Point is the Identification of an Opportunity

It all starts here

Opportunity Recognition The Very y g y Heart of the Entrepreneurial Process

What s Whats the difference between and idea and an opportunity?
Opportunities are created, or built, using ideas and p y entrepreneurial creativity An opportunity has the q pp y qualities of being attractive, g , durable, and timely and is anchored in a product or service, which creates or adds value for its buyer or end user user.

Chaos and Change

Friends of the entre/intrapreneur? What are usual areas which spawn and drive opportunity?
Regulatory changes 10-fold changes in 10 years or less (Moores law) Reconstruction of value chain and distribution channels Maturity of main business models/Uncertainty for revenue growth drivers Market leaders are customer obsessed or customer blind

Where are Opportunities Identified?

Technology changes (Moores law, Metcalfs law, disruption) Market changes (value chain disruption/obsolence/vulnerability disruption/obsolence/vulnerability, deregulation) Societal changes (changes in ways we live, work, learn etc) Brontosaurus factor (doing things better than an incumbent) Undervalued assets Different applications of new products (i.e. glue and post-it from 3M, polarized lights for cars: Polaroid, angina drug from Pfizer..) Being the right person in the right place in the right time Henry Ford question

Arthur Rock Criterion for New Opportunities

Look for business concepts that will change p g the way people live or work

Imperatives for New Opportunities p pp

Think BIG Skills to assess opportunities early to avoid wasting time and effort (experience counts..) Creative thinking C ti thi ki Team Creativity y Big opportunities with little capital Timing

Windows of opportunity pp y
$1B

Market Market Siz ze

$500M

$250M Window of opportunity $100M 0 5 10

Time (years)

20

Opportunity Screening General Criteria

What are criteria for evaluating new product/service opportunities? Viability Timing Market size In house skills Competition

Opportunity Identification.. pp y
This device has so many shortcomings that cannot be used as a communication medium, Western Union Finance Services on the first phone devices, 1876 d i This box playing commercial music has no commercial value. Who would pay for wirleess messages?, David Sarnoff, Industrialist when asked to invest in radio production 1920 production, Who would be interested in listening the actors talking?, H.M.Warner, Warner Brothers, 1927 There never going to be more than 1,000 cars in Europe since they wont be enough professional chauffers for them, Daimlel Benz PR Director, 1928 We ll never have enough cars to fill in all these roads, Charles Scott urban planner of L A l f Los Angeles, 1940 l We dont like this new guitar sound and music, people wont like it. DECCA records rejection of the Beatles, 1962 I see absolutely no reason for someone to have a computer at home, Ken Olson, Founder and CEO of Digital Equipment, 1977 640K RAM will be adequate for all applications, Bill Gates, Microsoft, 1981

Lifecycle of technologies & markets

# of New N Adopt ters Lead Users Early Adopters Early y Majority Late Majority Laggards

Time Physical limits

Effort

How to Communicate an Opportunity

What is the customer benefit; or, what f problem does the idea solve (what pain does it relieve)? li )?

What is the market?

How will it make money?

Customer Benefit

Entrepreneurial Activity Venture Creation

Types of Ventures
What i Wh t is a lif t l or M lifestyle, Mom and P d Pop venture?

What is a High Potential Venture?

The Creation Process/Cycle

The Founders and Team Opportunity Recognition and S O t it R iti d Screening i Resource Requirements and Evaluation Securing/Confirming Financing Sales d M k ti S l and Marketing C Crossing th Ch i the Chasm Managing Growth Good Times and Bad Times Exit, Exit Cashing out Harvesting Crash and Burn out, Harvesting, Burn, Dot-Bomb, Dot-Gone Just D It A i J t Do It Again.

Where to Avoid Savings..

Lawyers Accountants

Stages of Growth
$100M

$50M

Sales

$25M

$3M $1M 0

Idea / Venture Start-Up High-Growth Maturity Stability

2-3

8-10

13-15

Time (years)

The New Venture Team

What are the team philosophies and attitudes that the best entrepreneurs fashion in building team? Cohesion Teamwork Integrity Commitment to the long haul Harvest Mind-set - (not big car and big office) Commitment to Value creation - Win/win and sharing the wealth Equal i E l inequality - N d lit No democracy, l d hi and role leadership d l sharing, but reward based on contribution. Sharing q y q y good thing g g generally. y equity equally is not a g Fairness, Sharing of the harvest

What Investors Look for

Has t e tea worked toget e be o e as the team o ed together before? Do the members have the right experience? Do the founders know their weaknesses and are ready to address them? Are the founders clear about their future role? Ownership future? Have they agreed on a common goal? Are they fully committed to the goal Are they putting personal stakes into it?

New Venture Financing

Forms of Financing
Self Financing Angel Investors (private persons, companies) Venture Capital Bank Loans/Credit Lines Private Equity Corporate Partners

What is PE?

Private Equity

Venture Capital

Early stage

Seed

Start-up

Expansion

Replacement Capital

Buyout

41

Entrepreneurship Today

Emerging Markets Entrepreneurs

Scaring the West, Very aggressive Low cost base & Access to fast growing markets 610M internet users in BRICI countries today, 1.2B by 2015 Much more likely to access the internet via mobile devices rather than PCs compared to westerners (spurs service innovation) 2020 median age: India: 28, China: 37, America: 38, EU: 45, Japan: 49 Entrepreneurialism is much more popular p p p Shape markets (from video games to online karaoke) Examples:
India: Globalis: founded in 2001, offices in 11 countries, CEO 25 years old. Infosys: Largest global player on outsourcing is a 15 years old start up, Air Deccan from Captain Gopinath Ghana: SOFTtribe (tropically tolerant business solution provider provider, CellBazaar, virtual marketplace, Kamal Quadir Txteagle.com, crowdsourcing in emerging markets, Nathan Eagle from , p p y MIT, reaches 2B mobile phone subscribers via 220 operators. Already has largest contract-labour force in Kenya

Valley Updates
Quora (http://www.quora.com/about), Q&A site from FB employees, raized $14M, Valued at $87.5M Blippy (http://blippy.com/), Share and Review online purchases, raised $11M at a valuation of $46M, pre-revenue! Inkling (http://www.inkling.com/) , Interactive textbooks, raised $9M in valuation of $30M+ Groupon, founded 2008 with deal of the day enticement (recession helped), $ $135M raised on a $ $1.35B valuation,Europe leader: www.vente-privee.com , p p Swoopo, (www.swoopo.com), best dollar auction game product online. 60c pay for auctions, founded in Germany in 2005, valued at $87M, 26M revenues, 2.5M registered users. GoBid.com latest with one popping up in every market. the most pure, distilled evil in a business plan. Introduced discount on nominal price equal to money spent. Twitter valuation has been valued at $1B last summer on 3rd round up from $95M i mid 08 i 2nd round in id in d d

Interesting Areas Sharing/Renting

Zipcar.com, leading online car sharing, 500K+ active members, values at $58M. Americans spend 18% of their income to an asset which mostly lies idle. Overall market value estimates of $6B by 2015 (Frost & Sullivan) Streetcar: market leader Sullivan). in London. Carmakers and rental companies are moving in.. Neflix.com, online film rental, made $116M in 2009. Movies by mail Bag borrow or St l (htt // B b Steal (http://www.bagborroworsteal.com/welcome), posh h db b b t l / l ) h handbag rentals. Which pain does it rlieve?: <Allows women to avoid the emotional and financial sacrifices of the endless search for the right accessory> Rent-That-Toy.com Rent That Toy com (toys rental) valued at $32M rental), Couchsurfing.org, 3M registered users in 79K cities, excellent user feedback case (trip advisor model), valued at over $28M ThredUp.com, childrens clothes, videos etc exchanges freecycle.org, give away site, 8M+ members Attitudes for conspicuous consumption (Thorstein Veblen) have changed. Status is not displayed by what you own but by virtual means by boasting on what they are doing (twitter), what they are reading (Shelfari), what they are interested in (Digg) and who they know (Facebook). Collaborative consumption is n. Limits are there (you wont exchange clothes and not all are happy to short time rent a car)

Interesting Areas For Profit Activism

Microlending g Campaigns www.carrotmob.org http://1bog.org (one block off the grid). Brent Shulkin & Steve Newcomb (powerset exit to Microsoft) founded virgance for mission driven mission-driven ventures Lend me some sugar on FB www.kickstart.org

THANK YOU QUESTIONS??

Andreas Antonopoulos, PhD, MBA
Rector, University of New York in Prague Managing Partner, Working Knowledge